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Global Real Estate InstituteEspaña GRI 2014

Madrid 20-21 May

Keynote speech: “Spain’s Convalescence”

Prof. Pedro Schwartz

B.Ll., Dr. Iuris (Madrid), M.Sc. (Econ), Ph.D. (London)

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A weak €zone

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Money market interest rates

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€zone inflation (Annual % changes)

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Spreads against Germany

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Probability of credit events

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€ effective exchange rate

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€zone current account surplus

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€zone & US stock indices

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Spain was pretty sick

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Spain’s value added in construction

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Unemployment and employment rates (Spain)

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€zone unemployment

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Spain: bank loans

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Spanish bank: non performing loans

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Doubtful bank assets(SAREB effect shaded area)

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Spain is convalescing

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Economic forecast (Spanish Government)

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Foreign sector contribution to GDP growth

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Competitiveness

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Exports grow, more than imports

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Spain’s current account in surplus

• In the full year 2013, the current account recorded a surplus of EUR 7.1 billion (equivalent to 0.7% of GDP), which contrasts the EUR 11.5 billion deficit (equivalent to 1.1% of GDP) tallied in 2012 and marks the first surplus since 1986

• Consensus reckons surplus to be 1.9% of GDP in 2014 • In 2015 surplus could reach 2.2 % of GDP

(Source: Focuseconomics)

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Confidence returns

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Low systemic risk indicators

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ECB loans to €banks

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New credit to non-financials by Spanish banks

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Spanish inflation

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Spanish Budget deficit

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Spanish public debt

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Compared real GDP growth(Δ 1.4% in 2014)